Air Quality Guidelines To Influence Development Projects

SAN FRANCISCO-In June, the Bay Area Air Quality Management District adopted new CEQA air quality guidelines that will substantially influence CEQA reviews of real estate development projects in the San Francisco Bay Area through new significant impact thresholds for greenhouse gas emissions and risks and hazards associated with the siting of residences, schools and medical facilities near emission sources.

The new GHG and local community risks and hazards thresholds complicate CEQA reviews for Bay Area real estate development projects. Although compliance is voluntary in most instances, development project CEQA reviews that do not apply the new thresholds run the risk of facing legal challenges claiming that the Guidelines and the evidence upon which they are based demonstrate a significant impact. On the other hand, projects that do apply the new GHG and risk and hazards thresholds are more likely to require an EIR. The stringency of the new significance thresholds may also make it harder to fully mitigate or justify significant and unavoidable air quality impacts. These issues may resolve once cities and counties address GHG and risks and hazards impacts at a programmatic level, as recommended by the Guidelines. This will take time, however.

The Guidelines set new construction and operational significance thresholds at the project and plan level for regional criteria air pollutants and precursors (ROG, NOx, PM10, PM2.5, CO), stationary source and non-stationary source GHGs, cancer and PM2.5 risks and hazards, and odors. The Guidelines also set a “no net increase” threshold for regional plans with regard to GHGs, criteria air pollutants and precursors, and toxic air contaminants. The following focuses on the new significance thresholds that are the most relevant to real estate development projects.

Project-level GHG Thresholds for Non-stationary Sources.

Real estate development projects are not deemed to cause a significant GHG impact under the Guidelines if they (i) emit less than 1,100, metric tons of CO2 equivalent per year (MTCO2E); or (ii) emit less than 4.6 MTCO2E per resident and employee generated by the project (i.e., total GHG emissions divided by total number of project residents and employees); or (iii) comply with a “Qualified Greenhouse Gas Reduction Strategy” (i.e., a programmatic framework for the reduction of GHGs adopted by local government that meets new State CEQA Guideline 15183.5).

To provide context, a project would exceed the 1,100 MTCO2E significance threshold if it consisted of more than 56 single-family homes, 78 condominium or apartment units, an 83-room hotel, a 19,000 square-foot shopping center or a 346,000 square-foot office building. The 4.6 MTCO2E standard may be an easier threshold to meet, but arguably disfavors retail and mixed-use projects. As mentioned above, the project-level compliance burden may lessen once local government adopts a Qualified Greenhouse Gas Reduction Strategy. 

Project-level Local Community Risk and Hazard Thresholds.

Real estate development projects are deemed to cause a significant risk and hazard impact under the Guidelines if, by locating project receptors within 1,000 feet of existing emission sources or by locating project emission sources within 1,000 feet of existing receptors, receptor cancer risks increase above 10.0 in a million, non-cancer risks increase above a 1.0 Hazard Index, or ambient PM2.5 levels increase above a 0.3